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DECISION

Decision No. 250/QD-TTg of February 10, 2010, approving the Scheme on formulation of the master plan for development of notarization practicing organizations in Vietnam through 2020

THE PRIME MINISTER

Pursuant to the December 25, 2001 Law on Organization of the Government;

Pursuant to November 29, 2006 Law No. 82/2006/QH11 on Notarization;

Pursuant to the Government’s Decree No. 02/2008/ND-CP of January 4, 2008, detailing and guiding the implementation of a number of articles of the Law on Notarization;

At the proposal of the Minister of Justice,

DECIDES:

Article 1. To approve the Scheme on formulation of the master plan on development of notarization practicing organizations in Vietnam through 2020, which is promulgated together with this Decision.

Article 2. This Decision takes effect on the date of its signing.

Article 3. Ministers, heads of ministerial-level agencies, heads of government-attached agencies and chairpersons of People’s Committees of provinces and centrally run cities shall implement this Decision.

Scheme on formulation of the master plan on development of notarization practicing organizations in Vietnam through 2020

(Promulgated together with the Prime Minister’s Decision No. 250/QD-TTg of February 10, 2010)

I. NECESSITY TO FORMULATE THE SCHEME

In the recent past, notarization activities in Vietnam have seen steps of development, positively contributing to the national socio-economic development, confirming more clearly the important position and role of notarization in social life and meeting increasing public demands for notarization in a socialist-oriented market economy. At the same time, notarization has served as an active instrument for effective state management, ensuring legal safety for transactions, positively contributing to preventing disputes and violations of law and enhancing socialist legality.

In furtherance of the Party’s and State’s policies, especially Politburo Resolution No. 48-NQ/TW of May 24, 2005, on the Strategy for Building and Improving Vietnam’s Legal System through 2010 with orientations towards 2020, and Resolution No. 49-NQ/TW of June 2, 2005, on the Strategy on Judicial Reform through 2020, on June 29, 2006, the National Assembly promulgated the Law on Notarization with a view to socializing notarization activities, creating conditions for notarization development towards professionalism in accordance with international standards and practices.

After two years’ enforcement of the Law on Notarization, the policy to socialize notarization activities has been welcomed by the society with many positive signs. The numbers of notarization practicing organizations and notaries public have quickly increased. According to statistics, at present, there are 244 notarization practicing organizations throughout the country as compared to 129 before the effective date of the Law on Notarization, including 131 notary bureaus with 410 notaries public and 113 notary offices with around 200 notaries public appointed over the past two years.

The development of notarization practicing organizations has eased pressure on the state apparatus. The establishment of notary offices has created a healthy competition in notarization activities which have become more convenient and professional. In light of the socialization policy, many notary bureaus and notary offices have renewed their activities, establishing a professional, modern and effective working style. A number of notary offices have properly operated, gaining public confidence. People have many options for certification of contracts and transactions at notary bureaus or notary offices, depending on their demands. Reality in notarization activities in the past has proved the correctness of the policy to socialize notarization activities, which has facilitated the vigorous development of this type of professional legal service.

Separation between notarization and certification has created conditions for notarization practicing organizations to concentrate on the performance of their function. Certification of contracts and transactions has enhanced legal safety with the undertaking to incrementally transfer the certification of contracts and transactions from commune-level People’s Committees to notarization practicing organizations, contributing to boosting socio-economic development and building confidence of domestic and foreign investors.

However, apart from the above achievements, many limitations have been seen in current notarization organization and operation.

First, the development of notarization practicing organizations lacks a master plan and is irrational nationwide and in each locality. After two years’ enforcement of the Law on Notarization, notary offices have been set up only in 28 localities nationwide, with 42 offices in Hanoi, 12 in Ho Chi Minh City and 1 to 3 in each of the remaining localities. Due to the lack of rational planning, the development of notarization practicing organizations has been “spontaneous” without the State’s regulation. At present, contradiction has been seen in the development of notarization practicing organizations in different localities. Some localities have permitted the casual establishment, ‘hot’ development and irrational distribution of notary offices. In some provinces or cities, 9 or 10 notarization practicing organizations have been formed in one rural or urban district while none in others, leading to unhealthy competition among these organizations. Some other localities have not heeded the socialization of notarization activities or lacked awareness of this matter, thus failing to work out policies on development of notarial offices.

Generally, the network of notarization practicing organizations nationwide remains scattered and irrationally distributed, failing to achieve the purpose of socialization of notarization activities and to acquire conditions for transferring all contracts and transactions on land use rights from commune-level People’s Committees to notarization practicing organizations in order to ensure legal safety for people’s transactions.

Second, separation between notarization and certification under the Law on Notarization and Decree No. 79/2007/ND-CP has faced numerous difficulties.

After the Law on Notarization and Decree No. 79/2007/ND-CP took effect, certification of copies and signatures has been transferred to district- and commune-level People’s Committees; notarization practicing organizations have terminated the certification of copies. Meanwhile, the transfer of certification of contracts and transactions within the scope of notarization to notarization practicing organizations has met with numerous difficulties due to unawareness and poor implementation as well as to the lack of planning and orientations for development of these organizations, leading to overloaded certification work at commune-level People’s Committees while little notarization work at notarization practicing organizations; hence, some notary bureaus were compelled to dissolve while the development of notary offices after the socialization model is slow.

Third, the awareness of various agencies, sectors, localities and the entire society about the nature and importance of notarization activities in ensuring safety for transactions in particular and for socio-economic development in general remains low. A section of population cannot distinguish the nature of notarization from that of certification, failing to clearly realize the importance and benefit of notarization of contracts and transactions. Moreover, the simplistic legal thinking has caused difficulties to the transfer of certification of contracts and transactions currently undertaken by district- or commune- level People’s Committees to notarization practicing organizations. The propagation and study of the Law on Notarization in many localities has been carried out in a ceremonial manner.

Fourth, the state management of notarization activities has been relaxed, thus giving rise to negative phenomena and unfair competition among notarization practicing organizations, which have not been addressed in time. The state management has not been associated to the formulation of strategies and plannings on development of the notarization profession. The legal system on notarization remains incomplete.

In essence, notarization constitutes an activity of state power nature, which is authorized by the State to recognize the lawfulness and truthfulness of contracts and transactions. Notarization brings about legal assurances for legitimate rights and interests of citizens and organizations in accordance with the Constitution and law, wards off violations of law, prevents risks and disputes or serves as legal grounds for settling disputes, by competent state agencies. Together with the socio-economic development, especially when Vietnam has joined the World Trade Organization (WTO), become a full member of the ASEAN and actively participated in free-trade areas in the world, the notary demand has become more urgent for people and businesses. From the perspective of building a state ruled by law, a civil society and a socialist-oriented market economy, notarization serves as an effective tool to protect citizen’s legitimate rights and interests, an administration tool and also an important support instrument for judicial activities, and constitutes a basic condition for boosting the development of a market economy in Vietnam.

Notarized documents are valid as evidence. Notaries public are appointed by the State and answerable to the State, law and transaction parties for the notarization of contracts and transactions. They bear lifetime legal liability for the transactions and contracts they have certified.

With such particular role and function, notarization activities and notarization practicing organizations must bear the nature of extremely high stability and sustainable development. Unlike the development of public services of other types, the development of notarization practicing organizations requires regulation, distribution and control under a single master plan, particularly in the context of socialized notarization. In such context, it is necessary to have a national master plan on development of notarization practicing organizations in order to ensure that these organizations are set up and rationally distributed, fully and conveniently meeting people’s notarization demands and restricting the uncontrolled dissolution or irrational distribution of established notarization practicing organizations, which lead to unfair competition and lower the trustworthiness of an activity of state power nature, failing to ensure legitimate rights and interests of organizations and individuals when participating in contracts and transactions.

So, in light of the Party’s undertaking and policy and the State’s law and stemming from the nature of notarization activities and the past enforcement of the Notarization Law, the formulation of a master plan for development of notarization practicing organizations in Vietnam through 2020 with a longer vision for subsequent years is extremely urgent for the management and regulation of the development of notarization practicing organizations in the context of socialized notarization activities. Especially as forecasted, the notarization demand in the coming years will see a “boom” in Vietnam together with the development of the capital market and real estate market as well as the implementation of the policy to transfer the certification of contracts and transactions from People’s Committees to notarization practicing organizations under the Government’s Decree No. 88/2009/ND-CP of October 19, 2009, on the grant of house ownership and residential land use right certificates. In that context, the late adoption of a master plan for development of notarization practicing organizations will give rise to a danger of uncontrollability of the development of notarization practicing organizations and lead to instable notarization activities, probably causing risks to the operation of the transaction market, particularly in the credit and banking system, affecting legitimate rights and interests of organizations and individuals. In many countries which follow the Latin notarization model (such as France), master plans on notarization practicing organizations are formulated to regulate and distribute those organizations in localities.

In the Government’s 2009 working program, the Ministry of Justice was assigned to assume the prime responsibility for, and coordinate with concerned ministries and sectors in, preparing a master plan for development of the notarization profession through 2020. The formulation of a master plan for development of notarization practicing organizations in Vietnam is a difficult task. To formulate such a master plan on a national scale, various activities involving different ministries, ministerial-level agencies and localities should be carried out and necessary conditions should be met as well as effective inter-sector coordination is required. Especially, the formulation of such national master plan should be carried out on the basis of the plannings on notarization practicing organizations of all localities nationwide. However, local plannings on development of notarization practicing organizations at present fail to meet the set requirements. Thirty four out of 63 localities have promulgated their schemes on development of notarization practicing organizations, which were, however, formulated differently and largely not schemes planning the development and regulating the establishment and distribution of notarization practicing organizations in each locality. For this reason, the formulation and approval of a scheme on formulation of a master plan for development of notarization practicing organizations in Vietnam through 2020 with the principal content of mapping out necessary activities and solutions for formulating such master plan is extremely necessary.

The Ministry of Justice has so far coordinated with other ministries, sectors and localities in formulating the Scheme, holding many seminars and meetings with scientists and managers and senior officials from research institutes, universities, central and local state agencies, especially French notarization experts, to discuss and reach agreement on the basic contents of the Scheme. On the basis of contributed comments, the Ministry of Justice has finalized the Scheme and submitted it to the Prime Minister.

II. OBJECTIVES AND VIEWPOINTS

1. Objectives of the Scheme:

To formulate a master plan on development of notarization practicing organizations in Vietnam through 2020 as a basis for the development of a national network of rationally distributed notarization practicing organizations, meeting the demand for notarization of all contracts and transactions of organizations and individuals in society.

2. Viewpoints on the formulation of the master plan

a) The formulation of a master plan on development of notarization practicing organizations will be based on the socio-economic development strategy and the justice sector development strategy and planning, meeting in time greater notarization demands of individuals and organizations and ensuring that notarization is a public service; proceeding to transfer of the certification of all contracts and transactions from district- and commune-level People’s Committees to notarization practicing organizations with a view to professionalizing notarization, meeting the integration requirements while properly protecting legitimate rights and interests as well as legal safety for all transactions, contributing to enhancing the management of society by law and socialist legality.

b) The formulation of a master plan on development of notarization practicing organizations will be based on the definition that notarization is a special public service, on the high stability and sustainability of notarization organizations and notarization activities, which require strict management, orientation and regulation by the State.

c) Scientism, synchrony, comprehensiveness and feasibility of the master plan must be ensured. The master plan on notarization practicing organizations nationwide should be formulated on the basis of the formulated local plannings on notarization practicing organizations and experiences drawn from their implementation.

d) The master plan on notarization practicing organizations in Vietnam should point out a roadmap for development of notarization practicing organizations in Vietnam through 2020 and development orientations for subsequent years.

e) Development of notarization practicing organizations shall be planned on the following criteria: public demand for notarization, land area and population distribution, anticipated rate of notarization development and demand in each area, harmony and rationality in development planning, with the district level taken as planning unit for notarization practicing organizations.

III. ACTIVITIES AND SOLUTIONS

1. Activity 1: Investigating, surveying and assessing the organization and operation of notarization practicing organizations nationwide; surveying, exchanging and learning experiences from the planning of development of notarization practicing organizations overseas.

a) Investigating, surveying and assessing the organization and operation of notarization practicing organizations nationwide.

- Investigating the society’s notarization demands and the capability of existing notarization practicing organizations to provide notarization services, thereby forecasting the notarization demands and the trend of development of the notarization service market.

Implementation time: First quarter of 2010.

Investigation scale: Sample survey by zone and region.

Outcomes: Reports on investigation results on the society’s notarization demands and the capability of existing notarization practicing organizations to provide notarization services, forecasting the trend of development of the notarization service market.

- Surveying the actual situation of notarization organization and activities, the national network of notarization practicing organizations, thereby determining the criteria for distribution of notarization practicing organizations by zone and region.

Implementation time: First quarter of 2010.

Surveying scale: The survey will cover 6 zones and regions: the northern mountainous region, the northern delta region, the central region, the Central Highlands, eastern south Vietnam, western south Vietnam.

Outcomes: Reports on surveying and evaluating the actual situation of notarization organization and activities, the national network of notarization practicing organizations.

b) Surveying, exchanging and learning experiences from the planning of development of notarization practicing organizations in countries applying the Latin notary system.

Implementation time: First quarter of 2010.

Surveyed areas: France and Germany (state management agencies in charge of notarization: justice, courts; regional notarization associations and national notarization association, notarization practicing organizations…).

Outcomes: Reports on survey results and experiences which can be applied in Vietnam.

2. Activity 2: Formulating and promulgating criteria for the formulation of local plannings on notarization practicing organizations and guiding localities in formulating these plannings

- Formulating a set of criteria for planning on notarization practicing organizations for submission to the Prime Minister for approval before application by localities to formulating local plannings on notarization practicing organizations.

- Organizing 2 training workshops on criteria for and methods of formulating plannings on notarization practicing organizations for planners in all localities nationwide.

Implementation time: Second quarter of 2010.

Outcomes:

Guidance on the promulgated criteria and methods of formulating local plannings.

Local planners will be trained in the criteria and methods of formulating plannings.

3. Activity 3: Formulating plannings on development of notarization practicing organizations in provinces and centrally run cities.

a) Scrutinizing and assessing the schemes on development of notarization practicing organizations in provinces and centrally run cities, which were promulgated in accordance with Decree No. 02/2008/ND-CP.

Implementation time: Second quarter of 2010.

Implementation areas: All provinces and centrally run cities.

Outcomes: Schemes scrutinized and assessed against the criteria for plannings.

b) Supplementing, adjusting and proposing plannings on development of notarization practicing organizations in provinces and centrally run cities.

Implementation time: Third quarter of 2010.

Implementation areas: All provinces and centrally run cities.

Outcomes: Proposed plannings on notarization practicing organizations in all localities nationwide, which will be finalized and appraised by inter-branch appraisal councils set up by the Ministry of Justice.

An appraisal council will be composed of representatives of the Ministry of Justice, the Ministry of Natural Resources and Environment, the Ministry of Planning and Investment, the Ministry of Finance, concerned ministries and sectors and People’s Committees of a number of localities selected from different zones and regions.

4. Activity 4: Formulating a master plan for development of notarization practicing organizations in Vietnam

On the basis of the results of activities 1, 2 and 3, studying and formulating a master plan on development of notarization practicing organizations in Vietnam with the participation of experts of the Ministry of Justice, the Ministry of Planning and Investment, the Ministry of Finance, the Ministry of Natural Resources and Environment, several provinces and centrally run cities as well as domestic and foreign experts experienced in the formulation of plannings on notarization practicing organizations.

Implementation time: The whole year of 2010, completed by December 2010.

Outcomes: The master plan on development of notarization practicing organizations in Vietnam, which will be submitted to the Prime Minister for approval.

IV. ORGANIZATION OF IMPLEMENTATION OF THE SCHEME

1. Schedule

The Scheme starts in January 2010 and completes in December 2010 according to a specific schedule stated in Section III of this Scheme.

2. Implementation funds

a) The fund for the Scheme’s implementation will be allocated from the state budget as well as mobilized and donated sources (if any).

b) The fund reserved for the Scheme’s activities will be VND 3,500,000,000 (three point five billion dong) provided primarily by the Ministry of Justice in coordination with other ministries, sectors and localities.

The formulation of a detailed budget estimate for the Scheme complies with the State Budget Law.

c) Funds for the Scheme’s implementation in localities will be provided by local budgets. Based on the contents of the Scheme’s activities in their respective localities, provincial-level Departments of Justice shall assume the prime responsibility for, and coordinate with the provincial-level Departments of Finance in, estimating funds and submitting them to provincial-level People’s Committees for decision.

3. Division of responsibilities

a) The Ministry of Justice shall:

- Assume the prime responsibility for, and coordinate with concerned ministries, sectors and organizations in, organizing the implementation of the Scheme, ensuring proper objectives and set schedule.

- Guide and urge concerned ministries, sectors and localities in the implementation of the Scheme;

- Assume the prime responsibility for, and coordinate with concerned ministries and sectors in, reviewing the legal system on notarization and certification; suggest and propose competent authorities to amend, supplement or promulgate, or amend or supplement, within the scope of its jurisdiction, laws and regulations with a view to facilitating the development of notarization practicing organizations.

- Assume the prime responsibility for, and coordinate with other ministries, sectors and localities in, making preliminary and final reviews of the implementation of the Scheme.

b) The Ministry of Finance shall assume the prime responsibility for, and coordinate with concerned ministries, sectors and localities in estimating funds for the implementation of the Scheme in accordance with the State Budget Law and relevant legal documents; and coordinate with the Ministry of Justice in implementation of the entire Scheme.

c) The Ministry of Planning and Investment shall coordinate with the Ministry of Justice and concerned ministries and sectors in establishing criteria for plannings on notarization practicing organizations, formulating a master plan on development of notarization practicing organizations in Vietnam and carrying out other activities of the Scheme.

d) The Ministry of Natural Resources and Environment shall:

- Coordinate with the Ministry of Justice and concerned ministries as well as sectors in carrying out activities of the Scheme.

- Assume the prime responsibility for, and coordinate with the Ministry of Justice and concerned ministries as well as sectors in, scrutinizing the legal system on land; suggest and propose competent authorities to amend, supplement or promulgate, or amend or supplement within the scope of its jurisdiction, laws and regulations on land related to notarization, ensuring the consistency and harmony between land and notarization management.

e) The Ministry of Construction shall:

- Coordinate with the Ministry of Justice and concerned ministries as well as sectors in carrying out activities of the Scheme.

- Providing information on urban construction, management, development and planning, which will serve as a basis for formulation of plannings on development of notarization practicing organizations.

- Assume the prime responsibility for, and coordinate with the Ministry of Justice and concerned ministries as well as sectors in, scrutinizing the legal system on construction and housing; suggest and propose competent authorities to amend, supplement or promulgate, amend and supplement within the scope of its jurisdiction, laws and regulations on construction and housing related to notarization, ensuring the consistency and harmony between construction and housing and notarization management.

f) Provincial-level People’s Committees shall:

- Work out plans on, direct and organize, the implementation of the Scheme in their respective localities; assume the prime responsibility for carrying out activity 3 in Section II of this Scheme in their localities, ensuring quality, effectiveness, set requirements and schedules.

- Provide funds for the implementation of the Scheme in their respective localities.

g) Ministries and ministerial-level agencies shall, within the ambit of their respective functions, tasks and powers, coordinate with the Ministry of Justice in carrying out relevant activities of the Scheme.